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Monday, September 24, 2012

It happens every quarter, every time there is a product launch: some foolish analyst predicts earnings or sales and gets it wrong. But many in the tech media world then write that it was the company "missed", not the analyst. Sorry, but if I say the Dodgers are going to win the West and the Giants do it, I'm the one wrong - after all, it wasn't the Dodgers that made the prediction.

As you probably have read already, Apple has reported that the iPhone 5 launch has gone peachy, with sales exceeding 5 million units, 1 million more than a year ago with the launch of the iPhone 4S. (There probably would have been even more sales but many FedEx drivers updated their iPhones to iOS 6 and couldn't locate the Apple Store using Maps _ OK, I made that part up.)

So what is the real story? If you are a tech site there shouldn't be one – tech sites are supposed to cover technology not forecasts. But you'd be hard pressed to find a tech site that isn't obsessed with earnings and market share stories. (Maybe they should concentrate on spreading false Facebook rumors. Oh, they are. Never mind.)

The financial news sites certainly should care about earnings and sales. But they are not all honest reporters of the news. BusinessInsider, for instance, has been steadily beating the short-Apple drum for quite some time, and appear very disappointed that the company's stock has not cratered.

As for news sources such as Bloomberg, they reported that some analyst at Topeka Capital Markets had estimated sales to hit 6 million. He was wrong. Wrong, wrong, wrong. He predicted one thing and was off. It is, apparently, his business to be able to make sales predictions, but he clearly isn't very good at it.

So what should the story be? That some analysts are idiots and shouldn't be listened to. Like the folks who claimed WMD in Iraq, they were wrong, why are they still appearing on my TV screens? If Bloomberg had a story at all it was that this guy at Topeka Capital Markets remains employed even though he gives his clients bad information. Maybe there should be an investigation.

The reason we don't get stories that take this angle, I figure, is that the reporter wouldn't have anyone to talk to if they started admitting that their sources are faulty. But analysts are guys who couldn't make it as career criminals and so practice their trade at financial companies. They're charlatans, just ignore them and report the news. Please.

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